The coolest thing about the Internet, if you’re a small business owner, is that it really is a two way street. That means that your customers can tell you what they want rather than making you guess at their needs. Why is that good for you? You can get them what they want. You can do more with less money and less space for products. You can even get other businesses to carry your inventory for you, drop shipping it directly to the customer.

The key to success is getting people who want your stuff to trust you with their personal information. And that can be quite a trick. Imagine that Jane Smith wants to buy a size 6 blue polar fleece jacket. She’s got several different ways of finding it if you’ve got a traditional bricks-and-mortar store. She can call you up and ask whether you’ve got one and what price it is. She can go to your store and start looking for one. Once there, she can ask for help in finding one. All are good ways of finding the information and having Jane find the jacket she wants at a price she likes.

You can help Jane find what she wants even more easily if you use the Internet as a tool, a personal sales assistant that’s never on the phone, taking a break or at home each night. One of the advantages that you can have, as a small business owner, is in making certain that your Internet site has good manners. Jane may not mind having a trusted sales assistant know that she’s a size 16 instead of a 6, but she sure will mind if that sales assistant tells other people about it.

Web Site Privacy Policy

That’s why your site needs a good privacy policy. And that’s where a lot of "big" companies mess up both on the Internet and off-line. They’ll sell your information to lots of other people because it means an increase in revenue and retail margins are tight enough that it can make a big difference in their profitability.

VentureConsult.Com has chosen a simple privacy policy because we value our subscribers. We will never share information about our visitors or subscribers with anyone. And we will never sell information to companies willing to pay us for that information.

Do you need to take it that far? No. But if you want to get the greatest value from your Internet site, you must tell customers your policies and let them decide how much information they wish to share with you. The more they trust you—and the more that’s in it for them to trust you—the more willing they will be to share this information.

Getting a High Response Rate

In direct marketing, a 1 - 2% response rate is pretty typical. That means that for every 100 people you send an offer to, one or two of them will buy. It goes up significantly if you’re sending the information to a group of qualified buyers. These are people who are ready and willing to buy a specific product once they find out about it. That’s why information requests for high-ticket items like cars often ask if you’re ready to buy immediately, within the next three months, six months or a year. Since money now is more valuable than money later, you want to know which of your possible customers are ready to buy right now. If they’re ready to pay cash and take immediate delivery, so much the better.

You want to get people to tell you what they want. And you should be willing to pay them to do that because it will cut your marketing costs. You can pay them with information, or a special deal or you can even give them a gift certificate for letting you know what they need and what they want. Seth Godin, a specialist in Internet marketing, says that the biggest problem with mass-market advertising is that it interrupts what people are doing. An advertisement breaks into a television show or a telephone caller interrupts dinner. It’s irritating and it is becoming unnecessary. People are constantly bombarded with interruptions aimed at selling them something.

Permission Marketing

The Internet has made it possible to direct information only to the people who want it. If you’re selling nursery supplies (and home and garden is a wonderful business on the Internet), you can direct information to your customers based on where they live if they share their addresses with you. So you can get them to pay attention at the perfect time, rather than hitting them when it’s too early or too late for them to immediately plant the rose bushes that they want. According to Seth Godin, the first rule of permission marketing is that people are selfish. They’ll share information with a company only if they know that it’s going to be good for them.

What should you give them for registering with you and giving you permission to send them information about special offers? Ideally, it should be something that will get them to try your products or services. Once a customer has bought from you, they’re eight times more likely to buy from you again than a customer who has not made a purchase. A gift certificate is a good option. A number of businesses have been successful on the Internet by making an offer like this one: Fill out our questionnaire and we’ll give you a $10 gift certificate good on any purchase of $25 or more. Another option is to give them a gift with their first order. Another good alternative is to enter them in a sweepstakes that will give them something that they really, really want if they win.

When you are evaluating whether to do this or not, consider what the product or service will actually cost you out of pocket. I’ve had clients who refused to consider making this kind of offer because they thought it would cost them $10. Once they looked at the direct costs of making this offer, though, they often found it would cost them less than $3.50, depending on their cost structure. That was a much more acceptable offer for them to make and it purchased $10 worth of good will from each customer that accepted the offer. It was a good deal for everyone involved.

What kinds of information should you ask from your customers? A lot of businesses will want name, email address and demographic information such as age, gender and marital status. Other information such as street address, telephone number and credit card information can be useful to you and to your customers, if they trust your security, safety and appropriate use of the information. They don’t want to have to constantly enter and re-enter their billing information in order to make a purchase. Much simpler to click and verify once they’re certain that your business is a good one. If you are going to ask for this information, tell them how safe it will be and how you will protect their privacy and their finances. Then tell them what’s in it for them—convenience, possibly a frequent buyer program and any other inducements that will make your company a better choice for their purchases.

Does Offering a Reward Work?

A recent study demonstrated that a reward increased response rate by nearly four times over what could be expected without the reward. That’s a big change, one that could be very important to your success.

-Cindy Nemeth-Johannes